I am a physician and behavioral scientist at Duke University. My research and writing explores the quirks in human nature that influence our lives — the mixture of rational and irrational forces that affect our health, our happiness and the way our society functions. (What fun would it be to tackle just the easy problems?) I am currently exploring controversial issues about the role of values and preferences in health care decision making, from decisions at the bedside to policy decisions. I use the tools of decision psychology and behavioral economics to explore topics like informed consent, shared decision making and health care spending. My books include Pricing Life (MIT Press 2000) and Free Market Madness (Harvard Business Press, 2009). My newest book, Critical Decisions (HarperCollins), explores the challenges of shared decision making between doctors and patients.

How The Obamacare Employer Mandate Promotes Fairer Markets

Obamacare has come under intense criticism for harming businesses, which will see their employee costs rise as a result of the ACA employer mandate. A recent New York Times article reported that complying with Obamacare regulations would “cost about $1 per hour per employee” for agricultural companies paying people to work in the fields. That is a big increase in the cost of doing business, an increase that will lead to some combination of higher prices and lower sales, and therefore fewer jobs.

To this terrible news I say: Hurrah! It is about time for agricultural companies—and anyone else not providing health insurance to their employees—to start paying the full price of doing business.

I am a fan of efficient markets. I believe that in most circumstances, the world is better off if people have transparent information about the price of consumer goods, and the freedom to decide whether to part with their hard earned money in order to purchase such goods. It is wonderful that I can go to the grocery store and decide whether or not I want to buy strawberries priced at $4 a pint.

One result of efficient markets, often, is that the price of goods is brought down by competition, making life better for us consumers. I’m a fan, in other words, of low prices.

But I’m also a fan of fair prices, and here is where I get bothered by companies that free ride on the nation’s healthcare system. All else equal, a company that offers healthcare insurance to its employees will face greater production expenses than one which does not. One reason Walmart can offer such low prices is its practice of not providing health insurance for many of its employees. This practice gives Walmart an unfair competitive advantage over companies that do provide such health insurance, unfair because someone else inevitably ends up paying for the healthcare costs of those uninsured Walmart employees. Sometimes the bill is picked up by the spouse’s employer, who provides family coverage. That’s not fair. Other times it is taxpayers who pick up the bill, through state Medicaid programs. Frequently, it is hospitals who pick up the tab, when they fail to collect money from these patients. But even when the hospitals pick up the tab, it is still us general consumers who ultimately pay, because those costs are passed along to insured patients, meaning us. That means that I am paying—in tax dollars and in health insurance premiums—to make up for all those agricultural employees and Walmart workers who aren’t receiving health insurance.

Don’t get me wrong. I feel for the employers who will face this Obamacare fueled rise in their expenses. I feel for the consumers who may no longer be able to afford strawberries, which aren’t cheap even under present circumstances. And I very much feel for the people who will lose their jobs in the agricultural industry, or at Walmart for that matter, as a result of this new policy. But we cannot let these feelings get in the way of leveling the playing field, so that companies compete with each other on more equal terms.

And we cannot let these feelings cause us to lose sight of the people who will benefit from Obama’s employer mandate. Think of all those companies who have consistently provided healthcare benefits to their employees. They will now be better able to compete in the marketplace! Think of those community hospitals who have drowned in unpaid bills. They might not have to go out of business anymore!

Let me be clear: as regular readers of my blog know (yes, those readers do exist!), I am very concerned about healthcare costs. And I do not believe that Obamacare will reduce the cost of healthcare in the foreseeable future. And I’m concerned about that.

But Obamacare’s flaws should not prevent us from seeing its virtues. Obamacare’s employer mandate will make it harder for businesses to pass along their employees’ healthcare costs to the rest of us, while gaining an unfair advantage over their competitors.

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